Fertilizer markets in East and Southern Africa
- Dec 1, 2023
- 1 min read
Fertilizer is a key input in commercial agriculture and is used extensively in the production of commodities such as maize, a staple food in Eastern and Southern Africa. There is very little production of fertilizer in the region which is mostly imported by a few large firms. Because fertiliser is a traded product, prices are largely determined by the costs associated with importing – such as transportation, warehouse handling and bagging – as well as the margins earned by importers and traders.
This report prepared by CCRED and COMESA finds that markets in East and Southern Africa are oligopolistic in nature, with just two to five large firms sourcing fertilizer internationally in bulk. In Eastern Africa there are three main importers – Yara, ETG/SABIC and OCP. Southern Africa is similar, although with some differences in the main companies. The high levels of concentration in the region are further underpinned by high barriers to entry in the supply chain with very few firms having the capacity to import in bulk.
Prices of fertilizer in the region have remained at historically high levels through 2022 to mid-2023, despite the decline in global prices by two-thirds between April 2022 and March 2023.
